Remember how I mentioned that oil was dropping uber fast, and that if the decline continued gas has the potential to hit $.99 again? Do you also remember how I mentioned the only way to prevent the decline is with some major event? Well, there is one on the horizon – OPEC has signaled “significant” production cuts in hopes of stopping the potential slide.
A “severe” cut may be needed to halt the decline in prices, group president Chakib Khelil told the Associated Press in a Dec. 6 interview.
The members of OPEC believe that a reasonable price for a barrel of oil is roughly $75, but obviously the market doesn’t agree with the thinking right now. But why does OPEC hold this view? The countries that have membership in OPCE obtain most of their government budgets from the profits pulled in from oil sales. The lower the price of oil, the less funding available. The less funding available, the less money for things such as roads… schools… and military spending.
In case you were curious as to what countries made up OPCE, here you go:
- Algeria
- Angloa
- Ecuador
- Indonesia
- Iran
- Iraq
- Kuwait
- Libya
- Nigeria
- Qatar
- Saudi Arabia
- United Arab Emirates
- Venezuela
Related posts:
- OPEC is not your friend, cuts production, shoots your dog
- Oil hits 6-month high, Saudi Arabia says world can cope. I say Saudi Arabia can suck it.
- If oil continues to fall Russia may need a "bailout"
- Is anyone watching the price of oil now? At 37.71 you should be…
- December Auto sales are miserable, and we knew this, but the surprise of the pack was Chrysler